Trade-Ideas LLC identified Infoblox ( BLOX) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Infoblox as such a stock due to the following factors:

  • BLOX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $15.4 million.
  • BLOX has traded 177,923 shares today.
  • BLOX is trading at 3.50 times the normal volume for the stock at this time of day.
  • BLOX is trading at a new low 3.02% below yesterday's close.

'Weak on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as material stock news, analyst downgrades, insider selling, selling from 'superinvestors,' or that hedge funds and traders are piling out of a stock ahead of a catalyst. Regardless of the impetus behind the price and volume action, when a stock moves with strength and volume it can indicate the start of a new trend on which early investors can capitalize (or avoid losses by trimming weak positions). In the event of a well-timed trading opportunity, combining technical indicators with fundamental trends and a disciplined trading methodology should help you take the first steps towards investment success.

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More details on BLOX:

Infoblox Inc. develops, markets, and sells automated network control solutions worldwide. Its appliance-based solution combines real-time IP address management with the automation of network control, and network change and configuration management processes in physical and virtual appliances. Currently there are 3 analysts that rate Infoblox a buy, no analysts rate it a sell, and 4 rate it a hold.

The average volume for Infoblox has been 722,400 shares per day over the past 30 days. Infoblox has a market cap of $1.2 billion and is part of the technology sector and telecommunications industry. The stock has a beta of 0.42 and a short float of 4.2% with 2.95 days to cover. Shares are up 5% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Infoblox as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we find that the company's return on equity has been disappointing.

Highlights from the ratings report include:
  • The revenue growth greatly exceeded the industry average of 11.9%. Since the same quarter one year prior, revenues rose by 28.0%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • BLOX has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 2.61, which clearly demonstrates the ability to cover short-term cash needs.
  • INFOBLOX INC has improved earnings per share by 35.7% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, INFOBLOX INC reported poor results of -$0.44 versus -$0.10 in the prior year. This year, the market expects an improvement in earnings ($0.36 versus -$0.44).
  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Software industry and the overall market, INFOBLOX INC's return on equity significantly trails that of both the industry average and the S&P 500.

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